UOB outlines three reasons for USD weakness: Trump’s erratic trade policy, the big beautiful bill, and the Fed. Although UOB says the Fed rate cuts would weaken the dollar, Trump regularly tweets on his Truth Social about firing Fed chair Jerome Powell. Such a move would cause volatility, market watchers say.
As the US dollar remains under pressure from the Trump administration's policies, the sensible thing to do would be to hedge US dollar investments by either buying gold or diversifying away from US dollar assets.
UOB Global Economics & Market Research says the Federal Reserve’s rate cuts in 2H2025 could exert further pressure on the US dollar. The greenback has already weakened significantly against the Singapore dollar. The Singapore dollar was at $1.37 on Jan 2 compared to $1.27 on July 3 which is a lot in forex terms.
